A great post.
Economists certainly don’t speak with one voice, but there’s a general consensus on two principles of public finance that will lead to a more competitive and prosperous economy.
- Lower tax rates are more conducive to work and entrepreneurship than higher tax rates.
- Reducing the tax bias against capital formation will improve growth by increasing saving and investment.
To be sure, some left-leaning economists will say that high tax rates and more double taxation are nonetheless okay because they believe there is an “equity vs. efficiency” tradeoff and they are willing to sacrifice some prosperity in hopes of achieving more equality.
I disagree, mostly because there’s compelling evidence that the left’s approach ultimately leads to less income for the poor, but this is a fair and honest debate. Both sides agree that lower rates and less double taxation will produce more growth
(though they’ll disagree on how much growth) and…
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